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Trade Policy and Poverty in Benin: a General Equilibrium Analysis

Author

Listed:
  • Bernard Decaluwé
  • Epiphane Adjovi
  • Véronique Robichaud

Abstract

Economic and financial crisis in Benin since 1980s led the government to embark on a process of economic reforms in 1991. These reforms sought to remedy the fiscal and trade imbalances in order to accelerate economic growth. Trade policy reform was given priority. Import bans and quotas were eliminated, import duties abolished and a compensatory tax on commodities sold in the domestic market instituted. This study analyzes the effects of the trade policy reforms using a computable general equilibrium (CGE) model and household survey data. Results show that these reforms are more beneficial to households in urban areas, but contribute to worsening poverty conditions of the most poor in rural areas. If liberalization policies target better strategies aimed at fighting poverty, or at least not deteriorating the situation, they need to be designed in a way that they do not worsen the poverty conditions of the most destitute in society.

Suggested Citation

  • Bernard Decaluwé & Epiphane Adjovi & Véronique Robichaud, 2008. "Trade Policy and Poverty in Benin: a General Equilibrium Analysis," Working Papers MPIA 2008-14, PEP-MPIA.
    • Handle: RePEc:lvl:mpiacr:2008-14
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    References listed on IDEAS

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    1. Luc Savard & Épiphane Adjovi, 1998. "Externalités de la santé et de l’éducation et bien-être : un modèle d’équilibre général calculable appliqué au Bénin," L'Actualité Economique, Société Canadienne de Science Economique, vol. 74(3), pages 523-560.
    2. Adelman, Irma & Robinson, Sherman, 1989. "Income distribution and development," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 2, chapter 19, pages 949-1003, Elsevier.
    3. Hollis Chenery† & T.N. Srinivasan (ed.), 1989. "Handbook of Development Economics," Handbook of Development Economics, Elsevier, edition 1, volume 2, number 2.
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    Cited by:

    1. Obeng, Camara Kwasi, 2014. "Impact of import liberalisation on poverty: a dynamic computable general equilibrium and microsimulation analysis for Ghana," MPRA Paper 58182, University Library of Munich, Germany.

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    More about this item

    Keywords

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    JEL classification:

    • D6 - Microeconomics - - Welfare Economics
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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